Enbridge pushes back at Northern Gateway opponents

One of Enbridge’s top executives took to the Canadian Club of Toronto to swing back at critics this morning, after protests rocked the company’s annual general shareholder meeting last week.

The war of words is over the most high-profile Canadian energy project in years, Enbridge’s Northern Gateway pipeline, and the woman in charge of getting it built spared no hyperbole in her push to refute opponents during a speech at the Royal York Hotel.

“I think Northern Gateway is Canada’s most important infrastructure project today,” Janet Holder, the executive vice president for western access, said according to prepared notes.

The $5.5-billion pipeline, which would pump 525,000 barrels of bitumen a day from Alberta’s oilsands to the coastal port in Kitimat, B.C where tankers would then ship the petroleum to Asian energy markets, has the same national significance as the Canadian Pacific Railway and the St. Lawrence Seaway, said Holder.

“Like Northern Gateway, the CPR looked west and created an important transportation corridor to connect markets and resources,” she said. “(Northern Gateway) will catapult our world-class energy resources onto the global energy market and will immediately diversify our customer base, a critical step towards a stronger economy in uncertain times.”

The project’s game-changing potential lies in the fact that Canada’s oil reserves have so far been captive to one market, the United States, which allows them to get a better price for a barrel of oil than on the international market.

If the pipeline is built, it could provide a $2 to $3 uptick to every barrel sold out of Western Canada, an impact that would translate into a $270 billion contribution to national GDP for 30 years, said Holder.

“If we just do the straight arithmetic, this will be a $9-billion contribution per year for three decades,” she said. That’s slightly more than the entire contribution of the Canada’s mining sector or nearly double what forestry and logging contribute to national GDP based on 2011 figures, she added.

Stiff resistance

But unlike nation-building projects like the CPR and the St. Lawrence Seaway, Northern Gateway faces a set of present-day problems, starting first with opposition from many First Nations living on the pipeline’s route.

Enbridge says most of the aboriginal communities along the route support the pipeline and that many have signed on to take a 10 per cent equity stake in the project.

But a vocal aboriginal coalition, called the Yinka Dene Alliance, have toured the country to say otherwise, including crashing Enbridge’s shareholder meeting last Wednesday. They have banned the pipeline from traversing their territories and haven’t ruled out legal challenges or civil disobedience to ensure it. The alliance includes the Nadleh Whut’en, Nak’azdli, Takla Lake, Saik’uz, and Wet’suwet’en First Nations.

Earlier this month, the Nuxalk First Nation of Bella Coola, B.C. dropped out of the pipeline’s regulatory hearings because of the federal government plans to fast track the project. First Nations from across the country, including the Union of B.C. Indian Chiefs, have lent their support to the pipeline’s opponents.

Holder offered little in the way of a direct rebuttal to the alliance but did say the company held 2,500 public hearings and have met with more than 17,000 people in its consultations with communities affected by the route.

What’s good for Alberta…

She instead reserved her most cogent arguments for the economic nay-sayers, like NDP leader Thomas Mulcair, who recently criticized the federal government’s support for resource development, claiming it would be deleterious to Canada’s manufacturing sector.

What’s good for the oilsands is good for Ontario, said Holder, throwing cold water on the risk of so-called “Dutch disease.”

“Over the next 25 years, the oilsands industry is expected to purchase $63 billion worth of goods and services from companies in Ontario,” she said, citing a Canadian Association of Petroleum Producers report.

The 1,200 kilometers of piping needed for Northern Gateway will likely come from Ontario’s steel and manufacturing plants, and capital will have to be raised through Toronto’s banking sector, she said.

Northern Gateway will create more than 16,000 person years of employment in Ontario, $390 million in provincial tax receipts, $686 million in pay for Ontario workers and boosts the province’s GDP by $1.2 billion, said Holder, referring to a 2011 report by the Canadian Energy Research Institute.

As for environmentalists who oppose Northern Gateway, Holder toed the federal government’s line that U.S.-based philanthropic groups were fueling that opposition.

“The majority of opponents to the oilsands are not Canadian,” she said, adding that millions and millions of dollars are crossing the border to stop major Canadian development.

To buttress her point, she pointed to several polls that indicate broader support for Northern Gateway outside of the First Nation and environmentalist communities.

Nearly 50 per cent of British Columbians are in favour of the project, 32 per cent are opposed and 20 per cent are still undecided, according to an Ipsos poll, said Holder.

“The percentage of those in favour jumps to 55 per cent in Northern BC, where the pipeline is proposed to run,” she said.

Another Ipsos poll commissioned by the Canadian Chamber of Commerce found that two-thirds of Canadians think it’s possible to protect the environment while increasing oil and gas production and three-quarters think it’s important to diversify oil and gas export markets away from the United States.

Holder did not address the increased greenhouse gas emissions that will follow a boost in oil production, despite Canada’s reduced efforts to bring down emissions through regulations.

Taking stock of the pipeline’s controversy, Holder said the rancorous public discussion is a byproduct of building major energy projects today.

“It is not easy whether we’re talking about a new gas-fired electricity generating station, a two-kilometer upgrade to an existing natural gas pipeline in a populated area, or a new 1,200-kilometer oil pipeline that will stretch across provinces,” she said. “That is simply the reality of today’s world and the reality of our operating environment.”

“We believe that citizens across the country should get involved in the discussion on Northern Gateway,” she said.